New York LLC
Getting Started With a Limited Liability Company in New York
New York’s economy is ranked third in the U.S., with a $1.7 trillion gross domestic product. It outranks all but 11 countries in economic size. New York City has a larger economy than any other city in the United States. Opportunity abounds for those who want to create their own empire in the Empire State.
In 2019, the state of New York was home to 2.2 million small businesses, making up 99.8% of the state’s total business entities. These small companies play a significant role in NY’s economic health. They also employ 4.1 million people, over half of the entire workforce in the state. If you’re ready to join these forces, follow this guide for how to file an LLC in New York.
Step 1
Choosing the LLC Name for Your Company
While you probably already know your business focus, you might not have thought much about what name you want to give it. Now is the time to make that decision, as you must have a name before you can go any further in the process. It’s important to pick a name that resonates with you and that your customers will remember.
Your company’s name must meet New York’s legal naming requirements for businesses:
- The name must include the designator “Limited Liability Corporation” or the abbreviation L.L.C. or LLC.
- Your company’s name must be unique from other business entities registered in New York. Check the Department of State’s corporation and business entity database to ensure the name you’ve chosen is available.
- The name you choose cannot contain one of the state’s restricted words or phrases unless you meet the required conditions.
Once you’ve selected your name and made sure it’s available, you may want to consider reserving it. Completing the application for reservation of a name form and submitting the $20 fee reserves your name for 60 days while you go through the process to set up your LLC in the state of New York. You can request a total of two 60-day extensions, but each will cost you another $20 and require you to submit an extension application.
Step 2
Appointing Your New York Registered Agent
A registered agent is the person who or entity that you designate to receive service of process if your company gets sued. New York handles the registered agent requirement differently than any other state. You must appoint the secretary of state as your agent for service of process. However, you may choose to designate your own registered agent in addition to the secretary of state.
You can appoint yourself in the role, or you may choose a friend, family member or someone who will work in your company. The state only requires that the person you choose is over 18 years of age and a resident of the state with a physical address. You may also opt for a professional registered agent service.
Step 3
Filing the Articles of Organization With the State Department
The next step in how to file an LLC in New York is to complete and submit your articles of organization. This filing is how you make your business official with the state. It is a legal document that establishes a record of your company with the state. The form provides your official name and identifies the company structure. It may also include a statement of LLC member rights, liabilities, responsibilities and powers.
You can file your AoO online or by mail, and the filing fee is $200. If you submit your form online, you receive an email notification of receipt and a PDF copy of your application. If you opt to file using the paper form, the Department of State offers expedited services as follows:
- 24-hour processing for a fee of $25
- Same-day processing for a fee of $75
- Two-hour processing for a fee of $150
These fees apply to expedited services for any official, time-sensitive document and are per-document fees.
Step 4
Creating an Operating Agreement
Though the operating agreement is strictly an internal document, New York law requires every business to have one. The OA identifies all LLC members — even if you are the only one — and establishes the relationship between the LLC members and with the company. It also describes each member’s responsibilities, liabilities, powers, obligations, and rights. Your OA should also outline your company’s operating procedures. You may want to include other vital pieces of information, such as:
- Initial investments for each member
- Profit distribution procedures and guidelines
- Member voting rules
- Succession procedures for departing members
- Guidelines for adding new members
- LLC dissolution guidelines
- OA amendment procedures
You need to complete this document within 90 days of filing your AoO, but you do not file it with the state. Instead, keep your OA with your internal business documentation.
Step 5
Applying for Your Employer Identification Number
Every business entity needs an EIN, provided by the Internal Revenue Service. The IRS and the state use this nine-digit number for tax purposes. You also need it to open a business bank account and if you plan to hire any employees. Applying for your EIN is free, and you can apply online. A word of caution: Be prepared to complete your application in one sitting, as you cannot save your application, and the site times out when there is no activity for 15 minutes.
Once you obtain your EIN, you may want to open a business bank account. It’s essential that your business banking is separate from your personal banking to protect your personal assets. It also makes it easier to organize your financial information when filing your taxes.
Step 6
Meeting the State’s Publication Requirements for an LLC New York
Within 120 days of forming your LLC, the State of New York requires you to publish your AoO — or an article announcing the formation of your LLC — once per week in two newspapers for six consecutive weeks. The county clerk designates the newspapers for your publications. The county you work with is the one in which your registered agent’s address is located. Your notice must contain the following information:
- LLC name
- Business purpose
- Articles of Organization filing date
- County of business operations
- The physical address of the business, if applicable
- A statement identifying the secretary of state as your agent of service process
- Service of process receipt address
- Name and address of any additional registered agents.
Publishing your notifications can be costly. Rates in the state’s more populous counties can cost as much as $1,000 or more for each publication. Some companies choose a registered agent in a less populous county to save money fulfilling this obligation.
After you fulfill the requirements, you receive an Affidavit of Publication from the newspapers. You must complete and file the Certificate of Publication, along with the affidavit, and pay a $50 filing fee.
Step 7
Remaining Compliant With State Regulations
Once you establish your business, you need to make sure it is compliant with all state and federal regulations and requirements. Depending on the type of business you operate, you may need to:
- Obtain operating permits or licenses
- Collect and pay sales taxes
- Pay employer taxes to the state
- Pay additional taxes for specific industries
- Pay your federal taxes
Additionally, every year you need to pay an LLC filing fee based on the company’s gross income. The fee ranges from $25 to $4,500. Every two years, you also need to file a biennial statement with the Department of State. It costs $9 to file and is due every two years at the end of your LLC’s anniversary month.
FAQs
The basic cost to start an LLC is $200, but that fee only puts your business on the records with the Department of State. Other costs include paying for publication notices in two newspapers and the associated $50 Certificate of Publication state filing fee. Publishing costs could run more than $2,000 in some areas.
For federal and state filing purposes, limited liability corporations are “pass-through entities.” You do not pay corporate taxes. Instead, you pay taxes on the profits you made through the LLC as part of your personal income taxes.
If you file your Articles of Operation online, you receive immediate confirmation if your application passes the automated review process. If you file using the paper form, it can take up to seven business days after the state receives your documents unless you pay for expedited services.
No, you do not. The operating agreement is an internal document only. Once you complete your agreement, you file it with your business documents. However, it is important to note that state law requires you to create an OA and keep it on file.
Your company’s operating agreement should establish guidelines for adding an LLC member. Typically, new members are either voted in by existing members or appointed by a manager. Upon approval, you need to update your current OA to include the new member’s roles, responsibilities, liabilities, powers and obligations.
Getting Help With How To File an LLC in New York
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